New Report Finds De Blasio's Ferry Project Is Hemorrhaging Money

Mayor Bill de Blasio's embattled NYC Ferry project is facing another round of scrutiny, after an independent budget review revealed that the amount of taxpayer subsidies needed to keep the service afloat are even greater than previously known, and set to dramatically increase under a planned expansion. [SCROLL DOWN FOR UPDATE]

Released Thursday by the nonpartisan Citizens Budget Commission, the report found that the ferries receive taxpayer subsidies that are ten times higher per rider than NYC Transit riders receive, despite serving a ridership that is "highly seasonal and leisure-oriented" (read: tourist-heavy). That per-rider subsidy worked out to $10.73 in fiscal year 2018, according to the CBC, and is expected to balloon to more than $24 per trip on a planned Coney Island route announced earlier this year — or 2,257 percent more than what's allocated to the average subway or bus rider.

Meanwhile, NYC Ferry's operating costs have climbed to $57.3 million annually, with the city committed to spending at least $600 million on the system in the next three years.

"Reviewing the system’s costs and subsidies through its first full year of operations should prompt consideration of whether maintaining the same operating strategy, pricing model, and expansion plans will be the most efficient and most effective use of City transportation funding," the fiscal policy brief, which is titled Swimming in Subsidies: The High Cost of NYC Ferry, asserts.

The CBC recommends several reforms that the Economic Development Corporation could make to the system, including charging higher fares to non-commuters, or instituting dynamic pricing based on demand. While the mayor has insisted that the ferry fare remain at $2.75 to match the price of the MetroCard, the report points out that other "premium transit options," like the private ferries and express bus service, charge increased fares to offset their high operating costs.

Asked if they'd consider implementing such changes, a spokesperson for the EDC told Gothamist that the ferry's ridership has "grown dramatically in just two years because we’re providing affordable, efficient transit to New Yorkers that lack other good options," adding that the organization has "taken the resoundingly positive feedback from over 8 million riders from the Rockaways to Soundview as an encouragement to bring NYC Ferry to even New Yorkers in the years ahead."

Those New Yorkers for whom a ferry commute makes sense do seem to love it, with riders praising a range of improvements over their previous commutes, including better reliability, an on-board bar and a "more civilized" environment.

But the CBC report also echoes questions about the ferry's demographics, and concerns about the system's lack of transparency. Because NYC Ferry is funded through the EDC's budget and operated by the private company Hornblower, it is not subjected to the same disclosure requirements as other transit projects.

So far, efforts to shine a light on the taxpayer-funded contract with Hornblower have done little to reassure ferry skeptics. Last week, NYC Comptroller Scott Stringer blocked the city's plans to spend $82 million to purchase the boats from Hornblower, after a review of the procurement contract found it suffered from "seemingly inexplicable decision that are proving to be needlessly expensive to taxpayers."

Read this and imagine if we had instead spent our money on a massive network of separated bus lanes and protected bike lanes. https://t.co/QD7mvtywhA

Asked about the comptroller's conclusion last week, de Blasio lashed out at reporters: "Dear friends in the media: help be visionary," he said. "We're starting a whole new form of mass transit. Anyone who wants to say, 'Don't start a whole new form of mass transit, what we got now is enough,' come on into the subways with me and I'll prove to you it's not enough."

One problem with that argument, as repeatedly emphasized in the CBC report, is that the ferries are not mass transit. The entire system transported just 91 passengers per revenue hour last year, according to the CBC, and carried fewer passengers in a year than the subway serves in a single day. As transit advocates see it, the hundreds of millions of dollars in taxpayer funds devoted to keeping the ferries cheap comes at the expense of the city's less-shiny, but far more utilitarian transit modes.

"The resources Mayor de Blasio has lavished on ferries dwarf what he’s done for bus riders," Transit Center Communications Director Ben Fried told Gothamist. "This mayor campaigned on leveling the economic playing field, but as long as he’s spending more on low-ridership ferries than on bus lanes and transit signal priority that help hundreds of thousands of New Yorkers connect to jobs, he’s violating that promise."

"City Hall needs to change course and put funds and political capital behind the bus plan before it throws more money at ferries," he continued.

A spokesperson for the Mayor's Office did not respond to Gothamist's request for comment.

UPDATE 3/29/19: Asked about the CBC’s report during his appearance on the Brian Lehrer Show on Friday, Mayor de Blasio called the findings a “short-sighted analysis” that failed to account for New York City’s expanding population.

“Anyone who thinks our existing transit system can handle all that [population growth] is somebody who thinks marijuana has already been legalized in New York state, and is smoking some,” the mayor quipped. “The fact is it’s impossible to do what we have to do in the city if we don’t expand mass transit options.”